Medical Device Daily Contributing Writer

WASHINGTON – Among the many interventional firms exhibiting at this year’s Transcatheter Cardiovascular Therapeutics conference is ev3 (Plymouth, Minnesota), which describes itself as “focused on catheter-based technologies for the endovascular treatment of vascular diseases and disorders”.

Earlier this week, the company held its first-ever formal meeting at TCT for Wall Street analysts and portfolio managers, where its president/CEO Jim Corbett, key members of ev3’s management team, and prominent interventional physician customers discussed the company’s strategy to become an even more powerful force in the interventional world.

Corbett kicked off the meeting by saying that the company participates in markets that approximated $3.2 billion in 2005 and are expected to more than double to $7 billion by 2010.

He said, “we perceive that there is an ‘innovation gap’ in these markets, as the large interventional companies are vigorously defending their turf in such key areas as coronary stents and implantable cardio-defibrillators and therefore cannot focus effectively on emerging technologies. We are highly focused there.”

The success of the company’s strategy has been amply demonstrated, as its worldwide sales have soared from just $37 million in 2002 to $134 million in 2005.

The several Wall Street analysts who closely follow the company are forecasting global revenue in the neighborhood of $200 million-$205 million for 2006, with about 60% of this generated by its cardio/peripheral division, and the balance derived from its interventional neurovascular (INR) activities.

Both divisions have shown stellar growth in the past few years, each exceeding an annual compound growth rate in excess of 50%. This rate far outstrips the growth of the markets that ev3 serves and points to the success that the company has had in broadening its product portfolio with launch of innovative product and effective sales and marketing.

Stacy Enxing Seng, president of the cardio-peripheral division, noted in her presentation that just four years ago the company’s product line served just 10% of the estimated $2 billion market. In 2006, fueled by a torrid pace of new product launches, the company’s products now serve about 60% of its relevant market. She estimated that market at $2.5 billion in 2005 and further projected that it would grow to about $5.7 billion in 2010.

“We believe that we have introduced more new products in the peripheral market in recent years than all of our competitors combined,” she said.

ev3’s competition is impressive, with the likes of industry heavyweights Medtronic (Minneapolis, Minnesota), Boston Scientific (Natick, Massachusetts), the Abbott Vascular (Santa Clara, California) division of Abbott Laboratories (Abbott Park, Illinois) and the Cordis Endovascular (Miami Lakes, Florida) division of Johnson & Johnson (New Brunswick, New Jersey) all keenly vying for market share.

Perhaps its most important new product launch in 2006 has been the EverFlex family of products, featuring nitinol self-expanding stent technology. Introduced worldwide in the first half of 2006, EverFlex’s advantage is its unique design, which features spiral cell interconnections that enhance flexibility, a new wave peak structure that more efficiently distributes stress and resists compression, and longer lengths of up to 150 mm, which minimizes the need for overlapping stents when treating long lesions.

In rigorous simulated fatigue testing conducted by both ev3 and an independent testing facility, the EverFlex stent has demonstrated a 5- to 10-times improved resistance to fracture compared to the five competitive stents tested.

Stent fracture is widely recognized as a major shortcoming in stenting the superficial femoral artery (SFA) region of the legs. Two key peripheral vessel stent clinical trials, SIROCCO and FESTO, both demonstrated that stent fractures are a vexing issue and are highly correlated with overlapping shorter stents. Moreover, these fractures are directly related to re-occlusions of the SFA.

One of the speakers at the ev3 analyst meeting, Robert Minor, Jr. MD, director of Endovascular Interventions at OSF Saint Anthony Medical Center (Rockford, Illinois), said that “Clinical experience has shown that stent design is a critical indicator of performance, and I believe that the EverFlex stent represents a notable advancement in stent technology, delivering the best strut fracture resistance available. The benefit this provides to both patients and the healthcare system is significant.”

Minor went on to say that claudication — disability of walking due to crippling of the legs — has a dramatic negative impact on quality of life and is the “next tsunami” in the interventional world. He opined that products like EverFlex will play a key role in stemming this tidal wave.

In a bold vote of confidence for EverFlex, ev3 announced during the TCT conference a worldwide fracture-free guarantee in support of its new EverFlex stent family. In the event that an EverFlex stent should fracture within two years of implantation, ev3 will provide a free replacement product to the medical facility, subject to the terms and conditions of the program.

The EverFlex stent is currently indicated in the U.S. for the palliative treatment of malignant neoplasms in the biliary tree. ev3 also has obtained CE-marking for the EverFlex for general use in the peripheral vasculature, including the iliac, subclavian and superficial femoral artery.

The company has initiated a vascular trial, DURABILITY, in the Europe and will formally pursue an SFA labeling indication in the U.S. for EverFlex, launching a clinical trial in the first half of 2007 to assess fracture rates and patency rates compared to balloon angioplasty. A specific approval for the SFA is expected in the second half of 2008.

EverFlex is just one of several key product introductions in the past few years. Enxing Seng concluded her presentation by saying that “we are passionate and enthusiastic about the peripheral market opportunity and expect rapid growth in the coming years.”

Although smaller than the cardio-peripheral effort, the interventional neurovascular division has also been a major contributor to ev3’s growth. Its global revenue is estimated this year at about $80 million, nearly quadruple the $22 million registered in 2003 and the $54 million recorded for 2005.

Division president Matthew Jenusaitis, a veteran of the interventional device world, noted that ev3 is a key player in the INR world market, which he estimated at about $550 million annually and growing 20% per year.